In the new book “Def Jam, Inc.” (One World, 352 pages, $23.95), Stacy Gueraseva, a former editor in chief of Russell Simmons’s OneWorld magazine, offers a workmanlike chronicle of an exceptional story: the birth and evolution of Def Jam Records. It’s the story of a label that shaped, then reflected, then shaped hip-hop again as it grew from a local – and many thought fleeting – genre into the new pop music. It’s a story, early on anyway, about hustle during a time of uncertain reward and boundless possibility. Significantly, it’s also a multiracial story – a plotline often ignored in the telling of hip-hop’s history – beginning with the company’s founders, Russell Simmons and Rick Rubin.

Simmons, who would eventually be known as the hip-hop mogul responsible not only for Def Jam but also spinoff enterprises like Def Comedy Jam and the Phat Farm clothing label, began as a fast-talking promoter from Hollis, Queens. In an early example of the tireless networking that would characterize his rise, he convinced a Billboard magazine writer that he was worthy of inclusion in an early article about hip-hop because of his many connections, then used the writer’s connections – for Simmons had none at the labels – to land a record deal for his artist Kurtis Blow. “Christmas Rappin’,” the resulting single released on Polydor Records in December 1979, was a hip-hop milestone: the first rap record put out by a major.

But it was with another act that Simmons would cement his standing as hip-hop’s nonpareil impresario. Russell’s younger brother, Joey, had apprenticed himself to Kurtis Blow as a teenager, performing under the name “DJ Run Love, the son of Kurtis Blow.” When he went on to form a group with several friends from Queens, Russell applied all his energy and know-how to getting the group off the ground. He also suggested their name: Run-DMC.

A long-haired white kid from Long Island who dressed in black jeans and biker leather, Rick Rubin was an unlikely candidate for hip-hop moguldom. But, like Simmons, he was possessed with a keen ear and a confidence beyond his years. By college, he was a self-possessed jack-of-all-trades: an NYU film and video student, DJ, party promoter, and dabbler in art noise bands. He was also captivated by the hip-hop scene and sound emerging in the early 1980s. Most impressively, he managed to ingratiate himself to it, haunting the city’s clubs and befriending black MCs and DJs.

With his varied tastes, Rubin was a natural fusionist. Equally drawn to rock and rap, he saw great potential in the combination of the two. During his freshman year at NYU, he organized a party called “Uptown Meets Downtown” that featured the early hip-hop group the Treacherous Three alongside punk bands like Heart Attack and Liquid Liquid. Rubin met the fledgling Beastie Boys at a CBGB’s benefit show in 1982, and soon began DJing for them. He would be instrumental in steering their sound from hardcore punk to punkish rap.

In the nascent hip-hop community, it was only a matter of time before the two met. Simmons was flourishing in his promotion and artist management business with Run-DMC, Kurtis Blow, and Whodini; Rubin was one of the most inventive producers and keenest talent scouts around. Theirs was a marriage of convenience, but also of mutual admiration and complementary gifts. “I can’t believe you made that record and you’re white,” said Simmons to Rubin upon meeting him for the first time, referring to the influential Rubin-produced song “It’s Yours” by T. La Rock and Jazzy Jay, “’cause that’s the blackest hip-hop record that’s ever been!”

In 1984, the two became equal partners in Def Jam, which they started with a modest budget of $6,000 – most of which was donated by Rubin’s parents. The next year, they would sign a $2 million label deal with CBS/Columbia, giving them the institutional backing they’d need to market their acts to mainstream America.

Def Jam’s first single, released in November 1984, was LL Cool J’s “I Need a Beat” (the beat in question – a popping drum machine and squelching electro – supplied, of course, by Rubin). Thus began the most remarkable run in hip-hop history. Def Jam would dominate the rest of the decade. Consider this partial list of releases: in 1985, LL Cool J’s “Radio”; in 1986, the Beastie Boys’ “Licensed To Ill”; in 1987, Public Enemy’s “Yo! Bum Rush the Show” and LL Cool J’s “Bigger and Deffer”; in 1988, “The Great Adventure of Slick Rick,” Public Enemy’s “It Takes a Nation of Millions To Hold Us Back,” and LL Cool J’s “Walking With a Panther.”

“There is nothing that I’ve experienced in my life since that has been as exciting as the birth of Def Jam,” said one staffer of the early years, “because we knew nothing, we expected nothing, and we got everything.”

But even as Def Jam was dictating popular tastes, the tastes of its founders were diverging. Rubin’s interest had strayed to the metal and rock projects he was producing (Slayer, Danzig, the “Less Than Zero” soundtrack); Simmons, meanwhile, was pouring his energy into cultivating a roster of R &B acts for the Black Gold imprint, an offshoot of Def Jam. They were pulling the label in almost diametrically opposed directions, so it was no surprise that as the decade drew to a close, so did their partnership. Rubin left to form his own imprint under the auspices of Geffen Records, while Simmons – who was never a details man to begin with – turned over much of the day-to-day responsibility to a foul-tempered, tough negotiating associate named Lyor Cohen, who would one day run the label outright.

Def Jam began the 1990s uncertainly; its sound and artists were no longer cutting-edge. It would survive – then flourish – by continually reinventing itself. In the early part of the decade, when rap was dominated by the West Coast sounds of Dr. Dre, Snoop Dogg, and Suge Knight’s Death Row Records, Def Jam laid the groundwork for an East Coast hardcore rap revival, signing the likes of Redman, Method Man, and Onyx. In the latter part of the decade, Def Jam reasserted itself as the dominant label in hip-hop, as artists like DMX, Jay-Z, and Ja Rule stepped in to fill the void left by the deaths of Biggie and Tupac.

But even as the label’s sound was returning to the streets, its management shed its last vestiges of independence. In December 1998, the beverage and entertainment conglomerate Sea grams (which already owned MCA, Interscope, Universal, and Geffen Records) bought Polygram (home to Mercury, Island, Motown, A&M, and Def Jam) for $1.4 billion, making it the largest music company in the world, accounting for approximately 30% of industry sales. In the aftermath of the deal, Simmons sold the remaining 40% stake in Def Jam to the Seagrams Universal Music Group. The price? $250 million.

Gueraseva’s book ends on a sour note, with Cohen’s departure in 2004 and the installation of spendthrift R &B impresario L.A. Reid as the head of the combined Island Def Jam Records. She quotes Simmons’s open letter to the hip-hop community in which he questions “whether the legacy that Def Jam established will be maintained.” She concludes that “the Def Jam Records founded in Rick Rubin’s dorm was clearly a faint echo of the giant conglomerate it had become.”

But Gueraseva may have closed the book on Def Jam too soon. Late last year, after his much-celebrated retirement from rap, Jay-Z took over as president of Def Jam. In many respects, it marks a return to the label’s roots. As a former Def Jam artist (on the Roc-A-Fella imprint) and the most respected rapper alive, there’s no questioning his credentials or his connection to the rap world. His very presence has inspired talk of rebirth.

Jay-Z has taken to calling his reign “the Carter Administration” (his birth name is Shawn Carter), and the cover of the August 2005 issue of XXL magazine shows him seated in what looks like the Oval Office surrounded by his “Cabinet”: Kanye West, Lebron James, Foxy Brown, Memphis Bleek, Young Gunz, and others.” Jay-Z, Leader of the Rap World,” the cover line reads.

Inside, Jay-Z expresses his admiration for the label, its founders, and history. “I believe in Def Jam and the culture. I grew up watching Russell Simmons and these guys,” he says. “I wouldn’t take that for granted.”